Sheffield Resources Ltd. has released its guidance and production outlook for its joint venture Thunderbird mineral sands mine in Western Australia, detailing a comprehensive business improvement plan (BIP) that will result in lower costs.
For the 2027 fiscal year, Kimberley Mineral Sands (KMS) anticipates mining between 12.5 and 13.5 million tonnes of ore, yielding an expected 670,000 to 720,000 tonnes of ilmenite concentrate and 190,000 to 210,000 tonnes of zircon concentrate.
Total ilmenite shipments are projected to match production volumes under a life-of-mine offtake agreement with joint-venture partner Yansteel at a fixed contract price of US$123 per tonne, while zircon concentrate shipments are forecast to reach pricing between US$580 per tonne and US$650 per tonne.
Projected cash costs per tonne are expected to fall between AU$215 and AU$240 over the year.
To support ongoing standstill agreement discussions with senior lenders regarding debt obligations, KMS has developed the BIP designed to lower unit production costs without requiring major capital expenditure.
Key operational enhancements include lifting ore mining capacity up to an equivalent rate of 16 million tonnes per annum to keep the processing plant at full utilisation, supported by transitioned drill-and-blast waste mining methods.
Alongside the BIP, KMS has prepared an updated base case financial model (BCFM) to aid debt restructure negotiations. Focusing strictly on Stage 1 operations, the model projects steady-state annual production targets of 210,000 tonnes of zircon concentrate and 900,000 tonnes of ilmenite concentrate.
The BCFM forecasts cumulative free cash flows of AU$377 million between 2028 and 2032, expanding to approximately AU$1.43 billion by 2038 and AU$3.4 billion over the remaining life of mine.
“The BCFM demonstrates that Thunderbird can generate significant surplus cash to service and repay its outstanding debt,” said Sheffield Resources Executive Chair Bruce Griffin.
“It provides a solid basis for negotiating a restructure of KMS’s debt obligations during the proposed standstill and demonstrates the potential to generate returns to KMS’s shareholders, including Sheffield.”